CN reaches mitigation agreement with Hawthorn Woods, Ill.

CN reached a voluntary
mitigation agreement with the Village of Hawthorn Woods, Ill., located
approximately 40 miles northwest of downtown Chicago, that addresses the
municipality's environmental issues with CN's acquisition of the principal
lines of the former Elgin, Joliet and Eastern Railway Company. CN completed the
acquisition on Jan. 31, 2009, and is running trains over the line.

CN will provide funding for
a number of initiatives, including the maintenance of an existing quiet zone,
noise mitigation, emergency response training, pedestrian crossing protection
and traffic signals.

CN now has VMAs with 18
municipalities, more than half of the 33 villages and municipalities along the
EJ in Illinois and Indiana.

Jim Vena, CN senior
vice-president, Southern Region, said: "CN is pleased to have reached this
agreement with Hawthorn Woods, which reflects CN's ongoing commitment to
mitigate the impact of its EJ&E acquisition on communities along the line.
We will continue to work closely with all communities as we move forward with
the integration of the EJ&E into CN's rail network and complete planned
infrastructure improvements."

Hawthorn Woods Mayor Joseph
Mancino said: "The Hawthorn Woods Village Board carefully weighed the
merits of the agreement negotiated by our representatives and CN and concluded
it is in the best interests of the municipality to work on mitigation efforts
immediately. The agreement will address the community impact of CN's
acquisition of the EJ&E, thus safeguarding the quality of life in the
village. In the months and years ahead, we will maintain a close dialogue with
CN as it proceeds to integrate the railroad into its operations."

CN expects that full
integration of the CN and EJ&E networks will be accomplished within three years,
and it will communicate changes in a timely manner to the communities affected
by the acquisition.